In advertising, things move quickly. It is very easy to make assumptions about who your customers are and not actually know. However, if you take the time to really understand who is buying from you, your marketing will be more relevant to your audience and have a greater impact. You will also be able to get your message in front of the right people. Let’s look at some of the benefits of knowing who your customers are:
Layers of Insight
Most businesses know the basic demographics of their customers such as age, income, gender, and location. This is great information to start with, but there is so much more to your customers. In order to create the best marketing materials, you should look at multiple layers of customer data.
The first step to truly knowing your customers is creating a customer profile. You will start with the basic demographics, but then you should add on to it. Try to capture and analyze as much information as possible about your customers. Look at marital status, children in the home, pet owners, net worth, dwelling type, ethnicity, etc.
After you have fleshed out your customers’ demographics, look into their lifestyle data. Do they own a pool? Are they interested in gardening, home improvement, or cooking? Do they purchase high end clothes? Do they take domestic or international vacations? Are they interested in skiing or golfing? What devices do they use to interact with your brand such as mobile, desktop, or tablet? Lifestyle data will give you a well rounded view of who your customers are and is beneficial to informing creative and messaging decisions.
And finally, add in geographical data where do they live? How far do they go to reach your store? What competitors do they pass on the way? Do they shop at more than one of your locations? Each layer you add will help you gain greater insight into who you customers are and what matters most to them.
Know Exactly Who to Target
Not all of your customers will be good customers or repeat customers which is why a customer profile is critical to your marketing success. Identifying your best customers helps you determine which individuals to target on your next campaign. Score and rank each record by your ideal customer profile. This will help you identify top performers as well as understand how your data list is segmented.
You don’t have to guess where to allocate your resources. You can invest your best marketing resources on the top scorers and make informed decisions about which customers you should stay in front of and which customers you should remove from the list. Understanding the value of each record enables you to create strong tiered marketing plans.
When you know who your customers are, you can easily find a look-a-like audience. A look-a-like audience has the same demographics and data points as your top records. They are most likely to be interested in your product or services. This is done by running your prospect list through your customer profile model and scoring and ranking the list. You can select the highest quality records and purchase only the ones you need.
Reduce Marketing Waste
Knowing who your customers are also means you know which individuals to avoid. Low scoring records are least likely to be interested in what you have to offer. They require exponentially more resources and are the hardest to convert.
Our clients discover that 80% of their customers come from the top 30-40% of their list. This means that 60-70% of their marketing list only yields 20% of their customers. Instead of continuing to try to reach 100% of their customer base, they trim their list by 60-70%.
They are able to take their marketing savings and either invest more resources into their top customers, or they find new customers who match their ideal customer profile. Both methods drastically reduce their marketing waste and yield greater ROIs.
Create Custom Marketing
A wonderful benefit of knowing your customers is customizing advertisements for them. If your target audience is singles who love the outdoors and spoil their dogs, you can create messaging and images that speak directly to them. Incorporating your research into your marketing helps you connect with your audience on a deeper level.
If you have different customer groups, tailor your ads for each group. This will make your message even more relevant to the people you are trying to reach, especially when you show how your product or service will fit into their lifestyle.
Know Who Responded
When you identify exactly who you want to advertise to, you can see which individuals responded and which ones did not. Regardless of whether you targeted them through traditional or digital media, you can see which channels you used to reach them, what caught their attention, and how they responded. You are able to see actual response rates instead of estimations.
All of this information can be fed back into your customer profile. The more information you have the more you can fine tune your process and make sure you are reaching the right people for your business.
If you don’t know who your customers are, you will target a list of people and see results, but you won’t know why. Knowing why it worked or didn’t work is critical to setting up your next campaign for success.
Marketing is a continual process that requires constant feedback and adjustment. When you know who your best customers are and how your audience changes over time, you can make sure you are creating content that resonates with them.
If you need help collecting or analyzing your customer data, we are here to help. Just send us an email!